i'm mark crumpton. president trump says he is declaring a national emergency on the southern border in order to unlock money to build a wall. the move will allow him to bypass congress to spend a total of $8 billion on a border wall. speaking from the white house rose garden today, the president said he knows there will be legal challenges. expect to bemp: i sued. i shouldn't be sued. very rarely do you get sued when you do national emergency. then other people say, oh, if you use it for this, then what are we using it for. we have to get rid of drugs and gangs and people. it's an invasion. mark: in a joint statement,

house speaker nancy pelosi and senate leader -- minority leader chuck schumer called the unlawfulon, quote, "an declaration over a crisis that does not exist." the vice president continued his visit to europe today with a stop at auschwitz. it was his first visit to the murderedp where nazis more than one million people during world war ii, most of them jews. pence and his wife were joined by the polish president and the polish first lady. turkey is urging the united states to weigh in on the killing of saudi journalist jamal khashoggi. said his erdogan country has not yet provided all the evidence it has in the case. he also said turkey is determined to bring a case before the national courts and it will deliver voice recordings related to the murder. jamal khashoggi was killed inside the saudi consulate in istanbul in october. his body has not been found. supreme court justice ruth bader

ginsburg is back at work. the 80rt says five-year-old justice returned to the building today for the first time since undergoing surgery for lung cancer -- the 85-year-old justice returned to the building for the first time today since undergoing surgery for lung cancer. it's the first time she was absent since joining the bench in 1993. global news, 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. scarlet: from bloomberg world headquarters in new york, this is "bloomberg markets: the close ." i'm scarlet fu. caroline: i'm caroline hyde. as we approach the three-day weekend for those in the united

states, the s&p 500 is up 0.9%. interesting amount of risk appetite today, given that we are heading into a long weekend, but it is driven by hopes in china and the u.s. scarlet: some encouraging words from the president, even though we have no details on how those talks are going. we do have the detail of warren buffett buying some stakes in big banks, including jpmorgan, bank of america. energy stocks doing well as crude oil moves higher. caroline: in europe, the ecb saying that the slowdown in europe is clearly stronger and broader than thought and new stimulus measures are possible. that's why we are seeing the euro down. scarlet: of course, it is not just the big caps that are doing well. small caps are on fire as well. the russell 2000, the best performer of the major indices, higher for a sixth straight day. applied materials down by 4%,

disappointing forecast driving it lower. caroline: time now for our top calls. let's look at some of the key analyst recommendations out there today. credit suisse downgrading general dynamics to neutral. analysts are saying competitive threats in both i.t. and aerospace segments. canada goose. they recommend buying on recent weakness. it was down yesterday, down again today. finally, humana, $420 per share, the highest on the street. potential policy risks, quote, "meaningfully overblown." scarlet: charles schwab and fidelity announced dueling plans , effectively escalating a price war to win investors. this comes happier after vanguard announced -- comes half a year after vanguard announced it would offer 1800 etf's commission free on its platform.

our next guest says this race to zero is not all that attractive. dan is the director of behavioral finance and investment at betterment. great to see you. happy friday. you are a behavioral scientist. you look at why and how people make investment decisions. how enticing is the word "free" when investors are asked between different products? dan: i would also say it is problematically free. when you hear free, it means somebody is getting paid, but not by you. i actually like to pay a little bit for a number of reasons, but i worry when things are free. if you look at how social media companies monetize their user base is, they are not only not building products necessary to maximize our enjoyment of it, but they have a lot of small incentives to do little changes that you are not going to be aware of to make more money behind the scenes, selling customer data in ways you wouldn't approve of. i actually think it's good to pay a little bit. there's been a long 40-year drive where prices have been climbing lower in the asset

management business. that's been great. i think we are going a little too low. i want to be the customer of my investment manager. i want them to be on the line for me. when i hear free, i know there is some other way they are making money. caroline: that's you but is the rest of the world, thinking that? what works better? dan: i would say, when we look at what funds we are going to -- we don't have our own funds. we choose from vanguard, blackrock, etc. we want to know we are buying into a good fund that we can live with in the long-term. the last thing we want is to be put into a loss leader that looks good because it is free and then have that fund close a little later, a bait and switch or a short-term promotion. you want funds that are sustainable in their costs. that's why scale matters so much to very large investment firms. if i hear free and it is a small fund, my spidey sense -- scarlet: your spidey sense goes

off. a lot of people think they are smarter than they are. getting people to sign up for more expensive services later on. people want the cheaper or free option now, and i know how to avoid getting sucked in to those products that they are going to upsell me later on. i can fend them off. how reasonable is that belief? dan: it brings me back to, "a fool and his money are soon parted." if you believe that banks and investment management firms are not making smart decisions where they crunch the numbers and they know whether or not it is working out, you're going to beat them, i would worry about your confidence level. caroline: talking about confidence levels, we have of late scene confidence knocked out of the market in december, then suddenly rampantly rushed higher. we are seeing it in equities market and across high-yield. there is real risk appetite throughout january. i'm interested into how you have decided on your investment choices at betterment, but

equally how people have been looking towards betterment's own products. do you think this has changed people's psyche? dan: i think definitely. i would say that the big part of what happened in december was the preceding two or three years. we had a strong bull market that just kept going. 2017 was very odd in how it was. markets just went up. i think people were looking for a little bit of pressure to be let out of the system. i'm glad it went out with a whimper rather than a bank. -- bang. what happened in december and january was quite healthy. clients, wethat our have been looking for a long time at how we can expand the range of services we offer them. one of the things we noticed, twofold, number one, a lot of our clients were carrying a lot of cash in checking's and savings accounts, and those checking's and savings accounts were not matching what they could get risk-free in the market. if you look at short-term treasury bonds, yielding to 2.5%, saving%,

accounts were still near 0%. that was our own clients. most people should be putting their own money, even if it is in a short-term savings the uncle, into something -- savings vehicle, into something that would make a little more. scarlet: how big of force is complacency, in general? even as fees have come down and people look at the performance and they think, maybe i should switch over, they are kind of lazy. i know i am. you figure if you are doing better than the index, you can live with some of the costs. you can live with some of the loss aversion. is that a big driver? dav: the bigges -- dan: the biggest drivers are inertia. getting people to go through the process of changing things over is difficult. the second one is taxes. if you go through the process of switching from a high-cost, actively managed fund, especially where there is a salesperson on the other side of it, the number of tricks they will pull out to keep you in that fund is remarkable. there's a lot of fear mongering.

that active monitor might not have outperformed, but the markets -- there are large embedded gains. nobody likes to pay those out. people are irrationally averse to taxes. people will, on average, pay more than one dollar to avoid one dollars worth of tax -- one dollar's worth of tax. this can be very potent when it is used by the wrong people. caroline: thank you for that, dan egan. was a good year for the highest-paid hedge fund managers. we will give you a breakdown of the numbers next. this is bloomberg. ♪ ♪

caroline: the bloomberg billionaires indices' inaugural ranking showed the top paid hedge fund million -- managers made billions.

some of the big names who really managed to outperform the rest of the crowd. >> ken griffin has made a lot of big purchases, usually. guess what, he is on that list. million, wet $870 calculated. but he is not even the best paid. that has to go to jim simons, $ 1.6 billion. scarlet: these are massive numbers. >> enormous. scarlet: it's incredible, given that we hear that hedge funds have kind of struggled. how are they able to continue pushing these big numbers? simone: when you look at the top 10 most profitable wealthy money managers this year, they're at funds that are very established. they are often very institutional, for the most part. they have lots of different products. we used their largest products

in order to determine these numbers. but also, they have a lot of assets that they are making money on, generally. frankly, their performance was decent. the average hedge fund manager lost about 7%, according to some of the composite indices. 9%, 10%,e guys made $ 15%. it's not the 30% we saw back in the early 2000's. i think that's what's really changed. these numbers are not wildly out of the park. they are just consistent, and that is what investors are paying for. caroline: it's interesting. a lot of these juggernauts at citadel or renaissance, sometimes they have other things going on. includethis does not tiger global's private equity fund. this is simply the hedge fund. hedge fund that

managers can still make a lot of money, despite a downturn in the market. i think what we've also seen is that investors have gone two different directions. they have gone to the really big many managers -- money managers and the very small, where they think they can get that 50%. they might get it for a short period of time with something very volatile. i think what you look at when you look at the most profitable managers this year, these are the tried and true, the staid ones you are probably going to go with, with a couple exceptions. crest, which is a family office now. that's why these people are able to generate this kind of system. scarlet: michael cloud at bluecrest returning 25%. simone, thank you so much. the u.s. market close, just moments away.

we are looking at gains in u.s. equities. we picked up more gains heading into the close. it's been pretty much a straight line up over the last 40 minutes, 20 minutes. we will continue to see if that gathers steam. this is bloomberg. ♪ this is bloomberg. ♪

scarlet: just breaking news. there is an active shooter situation in aurora, illinois, in an industrial park. we will keep you posted on any developments, but the police department says it is an ongoing and active scene. now, as we head towards the close of the u.s. markets, we want to bring in joe weisenthal. the retail sales number yesterday threw people for a loop. today we got some consumer confidence data that seemed to push back against it. joe: it's really hard to take those retail sales numbers seriously in light of that strong university of michigan number. obviously, when we got those december numbers, we were like, where did this number come from, because it doesn't seem

corroborated in any data. it didn't seem to be corroborated in any earnings, per se. when you see consumer confidence holding up, i think that continues to cast doubt on it. yesterday was interesting because we saw stocks rebound after initially going lower, then they ended up flat. we were talking about how it feels like stocks want to go up. today we started up and we are ending up. caroline: basically one percentage point up on the s&p 500. slowly, but surely, we are eating away at the december selloff. joe: pretty impressive array sure of that december decline. scarlet --pretty impressive erasure of that december decline. scarlet: industry groups -- pretty broad advance as well. banks have extended their gain to 2.5%. caroline: thanks, warren buffett. scarlet: he added to his stakes, took some stakes in jpmorgan, bankamerica, along with some regional lenders. that is causing the whole sector to get a lift. telecoms, insurance companies,

also gaining. not that many decliners. transportation, basically unch. caroline: it is a risk appetite mood out there. it seems to be on the back of hoax that china and u.s. can get some sort of trade deal going -- of hopes that china and u.s. can get some sort of trade deal going. scarlet: we are still very much higher and we are slated to close higher for the sixth time -- fifth time in six days. just about seven and a half minutes to go before the close. romaine gets us started. >> i'm taking a look at a mortgage insurance company, shares up about 8% today, largely on a report from bloomberg basically saying the company had been holding talks for a potential buyout with apollo global management and fender bridge partners. those people saying discussions did stall over the potential deal and it is unclear whether they could be revived. the revelation giving shares a boost and giving shares of a lot

of competitors a boost today. it comes against the backdrop where we started to see a lot of private equity companies sniff around these financial services companies, particularly that appear undervalued. radian, like a lot of other mortgage insurers, never really recovered from the financial crisis. a lot of those companies drop heavily in 2007 and 2008. while they have recouped some losses, they are still trading at about 1/3 less than what they were at the peak. there may be one reason why a lot of investors are actually a little bit excited that maybe a deal could be in the works, not only for this company, but maybe others in the industry as well. emma: i'm keeping an eye on pepsico. after hitting a two month high, despite them saying profit will fall this year, the same thing coca-cola said yesterday and they got hammered in the market for that, seeing their worst stock drop ever for some 10 years. the difference seems to be profit margin.

we have a chart which shows the difference. pepsi is growing its profit margin. coca-cola margins are declining. pepsi keeping a handle on sales in north america when it comes to snacks and beverages. coca-cola saw sales decline in north america for drinks. pepsi to return some $8 billion to shareholders this year, to an increased dividend and by pack -- buyback. perhaps investors think that is more of the real thing. >> those shares they were talking about, down more than 20%, but the worst day since november of 2017. putting up a messy quarter, missing revenues, the fourth time that's happened out of the last eight quarters. the outlook, disappointing, too. let's compare newewll -- newell brands ge. in white, we have ge. in orange, we have newell brands over the last few decades.

both have traded higher into a relative peak over the last couple years and then down. you will brands is down about -- newell brands is down about 69% from its peak. ge is down about 80% or so. it may suggest, if the correlation holds, that the pain for newell brands could continue. caroline: we thank you for your breakdown. meanwhile, financials are still the out performers in the s&p 500, leading the gains as all 11 major sectors are in the green. we bring in our senior markets editor. mike, it seems financials got a bit of a boost from the oracle, but also how much were they helped or hindered? mike: yields are perking up again. you have sort of the fed risk is off the table, which i think maybe is good for bank sentiment to some degree. you have really gotten rid of most of the acute things people were worried about, a fed

tightening campaign, another government shutdown, and the china trade situation at least seems like they will be able to kick the can down the road and not increase the tariffs in march. financials are kind of a place to be, i guess. one thing i look at every friday is these detailed earnings tables we put out. tech is definitely losing the luster of the earnings growth. i think we are kind of in this spot where people are trying to figure out what the next market leader will be. obviously, industrials are crushing it this year. certainly helps to see financials when warren buffett shows a little confidence like that. joe: up 18% from the christmas eve lows. what are people saying about the speed of this? we are not getting the break. mike: i love the annual equivalency. it's some 200%. joe: we could just go month

after month like this. mike: it was preceded with a nasty, sharp selloff. obviously, it's hard to imagine it considering -- i don't think i'm out on too much of a limb saying that. to me, the question as i go back to the earnings,, i look at, we have to get through a pretty sloppy first quarter. the estimates are for a drop of about 2.5%. i wonder how much of this good news on trade, good news on the government will stabilize the forecast going forward. that's the big question. scarlet: mike regan is sticking with us. we have about 2.5 minutes to go before the close. we want to bring in the managing director of multi-asset solutions. you moved to an underweight position in equities in late november, but you've since gotten a little more positive. how much are the china trade talks driving some of that optimism? >> it's a big deal. i think the china trade talks that were stagnant when we brought our equities to an

underweight in november -- there was no negotiation going on. it was a tit-for-tat, back and forth. december 1 was the announcement, ok, we are going to do a timeout. ever since then, we have gotten the ability -- the names you want to hear. mnuchin, trump. you want to see those names in the negotiation, and that's what we are getting. the other thing -- if you were to come my the fact that you have a lower probability to a full on trade war, that's dollar negative. if you have the probability that the fed is going to be patient, which is on hold for the first table future, that's dollar negative -- for the foreseeable future, that's dollar negative. one what's really striking, thing that is really striking about this rebound in risk assets is how muted the reaction has been in the long end of the yield curve. you look at the 10-year chart, you wouldn't think anything else is going on. thinking about it from a multi-asset or multi-strategy --

multi-asset perspective, what does that tell you about where people should be allocating? ip: it's not as bullish in equity as we were at this point last year, because last year was a story of the whole world is drawing together. what we would consider this environment is is a financial conditions rally. right? rates are moving. even jamie dimon is not talking about rates going to 4%. we're not talking about rates jumping higher that would create the type of -- tighter financial conditions. if the dollar behaves and if rates behave and as u.s. gdp growth stays above zero, that's usually a nice runway to take a risk. caroline: will the dollar behave? i'm not seeing it much at the moment. are our market participants waiting for negative trends in the dollar? >> it seems everyone expected after the fed gave the dovish

expectation. it did not happen. i think it is a good sign. to your point, it has come down the last couple of days. scarlet: we talked about how indexes had a leg up. they are now climbing to new session highs. everything but the nasdaq. we are closing up 443 points on the dow. the s&p adding almost 30 points. up nasdaq up -- the s&p 500 .3%. getting a lift before the close before a three-day weekend. joe: it is not like there were that many incredible headlines. we keep getting different trade headlines back and forth. good news, bad news. it does seem a big part of it has to be the fed. you cannot explain this just on the dribs on tariffs. caroline: when you have chinese factory orders and signs of growth concerns, nevertheless

only two stocks were lower on the dow. let's dive deeper into the action on the markets. abigail, what are we watching of the close? abigail: i'm looking at the weekly chart ticking down this week's rally. it is remarkable. 200-week moving average. 50-week moving average. this week, we are above the 50-week moving average for the first time since last year on this remarkable rally. up 18% from the lows. when we connect this action to what happened in 2015 and 2016, we see it went around the 50-week moving average, danced with it for some time, suggesting we could see the s&p 500 start to flatline. prior periods would suggest we are likely to go back down to

the 200-week moving average. something to keep an eye on. romaine: i want to turn your attention to accompany that provides a lot of employee services for taxes and compensation. the shares rising about 23% today. the best day the company has had since it went public in 2014. now trading at its highest record on level. after coming after the company surprised wall street with the fourth-quarter earnings report that exceeded analyst estimates on the top and bottom line. the bottom line being boosted by cost cuts. analysts say that is ok. j.p. morgan upgrading the stock to a neutral and raising the price target to $60 a share. this stock was on a good run the past five or six days. it is the ninth best performer in the russell 2000 this week. emma: i want to give everybody something to think about over this holiday weekend. when we return to work tuesday

morning, the world's biggest retailer reports earnings. that is walmart. it has not preannounced holiday sales. the earnings will include the crucial holiday quarter. the key metric is same-store sales. the average analyst estimate is for a rise of 3.1%. you can see from the chart that u.s. same-store sales have had 17 consecutive quarters of growth at walmart. investors are going to want to see what is happening with e-commerce. that side of the business group 43% in the third quarter. investors want to see high numbers because that part of the business is not profitable. news involvingny walmart investment in india. recently, india has changed regulations for e-commerce and they favor homegrown retailers. on tuesday, expect a number of questions about that on the analyst calls. scarlet: a big bet.

thank you so much. still with us is phillip camporeale and mike regan. i want to pick up on earnings. what has surprised you about earnings season? i know the focus is on first quarter and getting through that, but what is taking you by surprise on the positive side and negative side? >> that is a big difference from the risk rally we have seen in january and february of this year versus last year. we are up again. what should we do now? the biggest difference between this year and last year has been the response when companies beat earnings. when companies beat earnings this time around, they are rallying over 2% that day. that is the best in 12 quarters. when they miss earnings, they are only hurt by about 50 basis points. last year when everyone expected companies to be earnings, they were not rallying by much. but if you missed, you were annihilated. that has been spectacular.

earnings season has not been spectacular, with the price action has been. joe: speaking of the price action, what is your review on positioning? is the pain trade such that people are skeptical of the straight line up so you get pops? when you get good news, everyone has to catch-up. >> that is part of what has driven this. is stillical analysis clinging to the idea you have to retest the low. it is looking less likely that will happen. if that should happen, that is going to be an ugly situation. setting that low on christmas eve on a weird half-day, low-volume gives us a pass on the. not that it is ever guaranteed. it is still in the back of my mind. if we were to retest the low. joe: it was the mnuchin letter that did it, right? [laughter]

>> i do think folks did underestimate how short people were in equities and how long people were in safe assets like cash coming into the year. the survey that had the most number of overweight's in cash since january of 2009, was that warranted? was that the worst december since the great depression in december? the world was short coming into this year. now showinge survey the most overcrowded trades are emerging markets. you are seeing dollar weakness going forward. we heard mohamed el-erian talking earlier this week about the only trade in town being u.s. outperformance. when you see the e.c.b. talking about more easing, when we have other central banks given the fed to get dovish, are we going to have this outperformance of an economic perspective in the u.s.? will we see growth globally? >> i'm glad you asked about the

e.c.b.. in theory, you would think if they keep things easy, that should be good for companies. it is the opposite. what folks really want to see. is the e.c.b. saying this economy is strong enough to start moving rates. all the financials getting crippled by the negative deposit rate start to see life again. it is almost ironic that investors want to see central bankers that are normalizing, not tightening. i think that is why the fed's neutral rate was so important. europe. mike, does anybody talk about it? it seems people are relentlessly pessimistic. do you see many people making the positive case for europe? mike: not really. joe: i keep waiting for someone. it feels like this relentless view. who is enthusiastic about europe?

mike: the only thing you could say about europe is it is the most consensus underway. we have seen over the past eight weeks you can get a short squeeze violently. i think that would be the only silver lining. u.s. and e.m. are still the high confidence trades for us. caroline: this was a great week for european stocks. one of the best weeks in three months for european stocks. maybe buyer beware. >> if people feel better about him -- e.m., i think europe is a bigger trading partner. scarlet: he is saying it is unlikely we will revisit lows for the u.s. will we revisit the lows for europe? >> europe can catch on to the broader risk sentiment happening in e.m. i think you could prevent that.

it does not mean it will outperform. but forus, it is not -- us, it is not a trade we want to be underweight. we do not think it will test the lows. by sympathy, it will lift confidence. we are underweight that part of the world. caroline: we saw stocks fall today. china's data was ugly, the factory orders. >> it was shocking. the shanghai composite had almost a 1% drop. it is not the type of day where china is going to run the show. the optimism toward the trade is growing for the trade situation, at least to kick the can down the road. i think that would help sentiment on china as well as much as it would in the u.s. to some degree. joe: speaking of china, at the beginning of the year, one of the things people said was a key

risk for all risk assets was the idea china did not have attraction or the ability to stimulate its economy anymore. we have not seen evidence they can. be does not feel like it is a risk now or people have stopped caring. weaken,ata continues to if there is evidence they don't have the ability to lift it up, will that come back to bite at some point? >> people were saying that because they were providing stimulus into a stiff wind of the fed saying as recently as december that they have a couple more tightenings to go. i think the stimulus could prove more effective if the fed is on hold. we will have to wait to see that. i think that could be a growing benefit for china, that the stimulus can work if the fed is on the sideline. >> there is often a lack to the stimulus for a few months. scarlet: we want to thank our

guests, phillip camporeale and mike regan. we want to give you an update on the previous breaking news. the city of are, illinois, says the active shooter has been apprehended. the shooter has been apprehended. we will get you more details as we get them. from new york, this is bloomberg. ♪

caroline: i am caroline hyde. romaine: i am romaine bostick. joe: and i'm joe weisenthal. caroline: markets up significantly. 1.7% on the dow jones industrial

average. joe: the question is, "what'd you miss?" trumpne: president declared a national emergency on the southern border in a bid to unlock more money to build his wall. the u.s. and china held trade talks as president trump floated the possibility of extending a tariff truce. cannabis competition. better-than-expected revenues and expected to have outsold competitors in canada. the ceo joins us ahead. president trump signed the congressional spending bill while declaring a national emergency. the president was not able to convince lawmakers to allocate $5.7 billion for a border wall, but the migration -- the declaration will free up about $8.3 billion. can you break down specifically what is in the bill congress approved? we know they are getting about

$1.5 billion that would go for some of the border wall requests trump made. why do we still need a neck -- national declaration? >> there's just under $1.4 billion for border fencing. it will not be a concrete wall. it will not be the prototypes president trump floated that included artistically designed steel flats. it will be for fencing built under the previous administration. that is the red line democrats drew in the bill which is why president trump decided to build the wall prototype he wants to he had to declare a national emergency. this will be fought in court. democrats are certain to file a lawsuit saying this is an illegal move the president is doing. it is also going to be fought in congress. democrats will try to overturn this. that will require a two thirds vote in congress. it is unlikely the president's opponents have got to stop them. joe: when it comes to the door decoration -- declaration of

national emergency, some point out if he is going to do this for his wall, maybe democrats will do this for guns or the green new deal when they have the presidency. what are the limits on what a president can do with such a declaration? >> it is an excellent question, joe. it is not explicitly drawn out. the national emergency act gives the president broad authority without having to do a fact-finding show or explain specifically within a parameter why this is an emergency. that is all going to be fought over in court. you are right. it is not only the president's political opponents. some of his allies are warning him this could set a dangerous precedent for democrats down the road to use this on things like funding a green new deal or declaring a national gun violence emergency and trying to ban certain weapons.

that is going to be something the president listens to, but it seems he has made up his mind. i think the question is how many republicans decide it is an unwise move. that is a decision for congress. caroline: remind us of whether this is strictly vote winning. how against this are some republican voters? >> republican voters are mostly with president trump on the idea of the wall. they support him taking extraordinary measures to build a barrier on the southern border because they believe in it that much. i think the president did this for that reason. he wanted to keep his base intact. he wanted to fulfill a campaign promise. he will not fulfill the part that mexico will pay for the law. it seems this is the last card he has to play. he was backed into a corner where he lost the battle of public opinion. he lost the battle in congress when he could not get money for this. this is all he has left. joe: even though he did not get

enough money or as much as he wanted, there is more money allocated to border security which is a hot button issue on the left. you have a lot of politicians who would not have been inclined to give up anymore in border security. how is this going to play for 2020 candidates? justifyiticians have to any affirmative vote for this? >> there is a fascinating split among senate democrats. 16 senators out of 100 voted against it. four out of the 16 are democrats running for president in 2020. they all voted no because they did not want to give president trump additional funds for immigration enforcement. these democrats are trying to appeal to progressives in the party who want to ratchet back on immigration enforcement and

not deport people in this country and not committing crimes. that is an issue president trump loves to debate. he thinks he has the winning hand on that issue and will try to paint the democrats as the party of open borders ahead of the 2020 election. i would expect that to be a major debate the country will be hearing a lot of. caroline: you have a great story out on the 2020 split. we urge you to read it. sahil poor, thank you -- kapur, thank you. what about the cannabis margins? this is bloomberg. ♪

caroline: time to look at stories trending.

they will decide about whether president trump can ask about visas on the senses. the court will expedite the case hearing arguments in april. it has not asked about citizenship since 1950. bloomberg.com is looking at the nigerian presidential elections. citizens can choose between the incumbent, the 76er old former military leader, and the 72-year-old businessman. him anporters call honest fighter of graft. he claims he had to revive the economy after corruption. are unpacking the battle between jeff bezos and "the national enquirer." conflictain how the intersects with president trump

and the crown prince of saudi arabia. you can follow all of these stories on your terminal and on twitter. joe: ontario-based cannabis company canopy growth released its latest numbers yesterday with a revenue increase of 280% in the quarter sending shares higher. i want to welcome bruce linton from ottawa. thank you for joining us. extraordinary growth on the top line which is what we would expect. talk to us on the ground. in the early months of legalization, there has been a lot of talk about kinks in the supply chain, all kinds of difficulties. what is the state of operations in canadian recreational cannabis? is smoothing. it it is not smooth yet. each province is turning out

more stores. as the storms go up, it means the supply chain needs to deliver more. that seems to be going together now. on february 20, that is the last time frame to put more input into the next products. we had version one of october 17 of this last year. in the fourth quarter coming up, there will be new products that go into the stores. i think that will put stress on everybody. it will also probably be tough for the illicit market because they will have real competitors that have almost everything they have an better versions of it. romaine: where you stand with regards to expansion into the u.s.? withe still in a gray area the disparity between federal and local laws. what are the plans for canopy to expand further into the u.s.? >> you are right. it is still federally illegal and state-by-state to choose.

the last couple of months, they passed a bill at the federal level to regulate the growing of hemp. inside him is an ingredient called tcb. that platform has allowed us to enter new york state. in new yorknvesting state. it will have about $150 million we will spend. it will be an industrial park to convince hemp for skincare products. we are in the u.s. there will be a few more states after that. the next step is the feds will probably say if the state decides it is ok, the feds will cause that not to be illegal in the state and we go in that way. caroline: there's plenty of talk about the cost at the moment. how much do you care about the concerns? we have analysts saying it is

meaningfully higher than peers. do you feel the spending is necessary and justifiable? >> some yes, so no. up until october 17, you could be in a major city in toronto sayingre was a billboard , can i get a sample before i buy it? preparation for the market we had to take down on october 17. there was that kind of expense. now we have almost completed the buildout of 6 million square feet. when you look at our cost now, suppose i have half a building with plants and the other building getting ready for plants. the cost of how those plants produce is the whole building. over this quarter and next, the whole building will be filled with plants which means our cost per gram will go down. the texture is important. i think the shareholders will be

very happy we spend the money. joe: will you tap the bond market to finance further expansion? >> one of the things that is kind of nice is i am media work today but don't have to find capital. we have about $5 billion canadian in the bank. as we get out another quarter, where ad be somewhere bond issue would make sense. this is becoming an investment grade investment in the company for the next 15 or 20 years. that is why we are seeing a 10 times increase in the amount of institutional investors that hold our stock. caroline: high times for the investors. great to have you, bruce linton from canopy growth. amazon says never mind. we are talking about second thoughts on the new york hq2.

this is bloomberg. ♪

i'm mark crumpton was bloomberg first word news. as we have been reporting, authorities in aurora, illinois say they have apprehended a shooter who opened fire in an industrial complex. aurora is about 40 miles west of chicago. according to the associated said that thess shooter works at the complex and "a pistol with a laser." president trump has signed legislation to avoid another government shutdown and pay for fencing along the u.s.-mexico

border. 50 additional miles of fencing, well short of the 200-plus miles he wanted. it will keep the government , financing several agencies through september. congressional democrats a big will use every tool at their disposal to oppose president tomp's emergency declaration move billions of dollars into building the wall on the border. debbie wasserman schultz says she will hold a hearing when congress returns. >> the president just lies whenever it suits him. we have historic lows of apprehensions at our border and attempted border crossings. there is no crisis at our border. congresswoman schultz says

the declaration jeopardizes national security. the nfl and quarterback colin kaepernick have settled a case that the league was colluding to keep him off the team. the league also settled another claim by player eric read. kaepernick made headlines when he protested police brutality by kneeling during the national anthem at games. the two sides have a confidentiality agreement. kaepernick has not played since the 2016 season. global news trey flowers a day on air and on tictoc on twitter -- 20 hours a day on air and on tictoc on twitter. i'm mark crumpton. this is bloomberg. breaking news. we understand that over is suing new york city over a rule limiting the number of drivers.

this is a company, remember, that has had many regulatory risks. we were learning yesterday the for uber being questioned. this company continues to litigate to grow, and it is suing new york for limiting its number of drivers. mike joins us now. has an investment in self driving cars, an element of uber. what you make of the regulatory issues up against the likes of uber and liyft? arehese regulatory issues huge. the fact that you can get in uber very quickly makes the service attractive. limiting the number makes it

less attractive. they are arguing for their lifeblood in having that kind of density. it's critical. it also creates jobs for people. if the positive argument. it's a very important issue. uber suingng about new york after amazon leaving new york due to obvious political fights, is this --a, do you see this as part of a broader tech backlash, and do you think companies are inerestimating the speed political quarters? and they areup scrappy and have to fight for their lives and at some point to become big companies with lots of power and may have to own up to the social responsibilities they have the problem is, when you look at uber or facebook, they grow up so quickly.

they don't have time to learn and adapt into the civic mindset they need to have. i think these issues, the lawsuits, the amazon situation, the privacy situation facebook , they will have to work through and develop the understanding they have social responsibilities. this is a learning process for all of tech. largerddition to these companies reaching maturation, we are also starting to get new technologies for smaller players, companies that could be the next uber or facebook. which areas in the tech space do you think is going to be as pivotal, among the areas we just mentioned? investedtwo areas we have those characteristics. one is self driving. self driving sounds fantastic because you have something that is safer, you don't have to worry about sitting in traffic

and support. the flip side is you take away jobs from people who drive. that has regulatory implications . thet of the reasons why services industry works the way compliancethere are factors that constrain the workforce of the industry. at some point it involves the betterment of a consumer's life and those regulations are important. you will see more and more industries like self driving you see friction between the old way of doing things and regulations set up to protect the consumer and the new way where in its heart, the mindset is let's make the life better for the consumer. caroline: interestingly, some of the concerns in the fight that when amazon's direction was facial recognition and the future of computer learning and

automation taking weight jobs. how much of a learning expedition and teaching expedition are companies on? at this moment in the heart of silicon valley, they have this tech backlash. we have seen a massive acceleration of new technologies like ai and machine learning, and just as we know the potential of how powerful these technologies are is unknown, we do not really know the of them.ons we do not know if there will be -- i think as an industry we will go into it. other countries and the world will do it if we don't. you will have to solve these problems along the way as you encounter them. optimist.hnology we will get the right answer.

learn from them, adapt, make the right rules. let's talk about the market itself. when we saw the big selloff at the end of last year, a lot of questions about financing first. given the plunge in recent ipo's, is that behind us or are there other signs of lasting effects in our industry from the public market volatility? >> uneasily, public market volatility has some impact on private companies, but the largest sources of capital tend to be very long-term in nature and frankly, tech has produced so many positive outcomes we are seeing more supply of capital, not less. frankly, even through that time to the end of the year where we saw a little bit of volatility, a little bit of down market, we did not see that. for the time being, these funds

should be private investment, large amounts of capital they have to deploy for a decade. goingct we will see that forward. caroline: we hope to see you on the show. -- coming up, trade talk optimism. we have all the details coming up. this is bloomberg. ♪

joe: up pitching a deal. china and the u.s. have been locked in high-level trade talks the last two days in beijing with the two countries working towards a preliminary agreement. president trump struck an optimistic note earlier today. president trump: it's going extremely well. who knows what that means

because it only matters if we get it done, but we are very much working very closely with xi, who i president respect a lot. bloombergore, our reporter from washington. classic trumpian statement there, instantly undercutting himself after he said it's going very well, but who knows what that means? what does it mean? question.good the readout we have gotten from the talks in beijing is progress is being made but a lot of work is left to be done and if you remember the readout we got from the last meeting only two weeks before now, it was the exact same readout we got from the white house and the chinese, which was we made progress, but a lot of work remains to be done. but if you look at the calendar whenhe march 1 deadline

the tariffs are set to more than doubled to 25%, time is running out and the progress is not tangible. on paper, they are still struggling on structural issues. of course, enforcement is really the big sticking point. the march 1 deadline is what the market cares about. do we get any sense the trump administration might be willing to push that deadline back or give some sort of reprieve? reporter: if you recall, we reported earlier this week that waving the delay. the president sort of confirmed this today in his speech saying, you know, if we get close to a deal i would be willing to look

at it, which really undercut his top negotiator who said on tv -- and he does not really do media very much, but he said on tv, this is a hard deadline. march 1 is when he tariffs go up. i have to talk to the present. the president confirmed to me march 1 is a hard deadline for him. again, we have trump undercutting his own negotiators looking foreally any clues next week that would confirm an official announcement to say there is more room to talk before the tariffs go up but we do not have clarity right now. caroline: do we expect any further meetings? what is next in terms of steps then? reporter: trump has said many times he does want to meet with xi again. he originally wanted to meet with them before the deadline on march 1. the logistics did not play out here, so that might play into

maybe delaying the deadline because the presidents really need to meet before any final agreement can be are in doubt. trump has said this on the record. there have been rumors around may be meeting and mar-a-lago. they could meet in china. they could meet in a third country. that's all stuff we are looking for next week and hoping when the talks continue we will get clarity on these questions. caroline: thank you. destinations. jenny leonard, we thank you very much indeed. now a quick check on our headlines. new york congresswoman carolyn political backlash directed at amazon cost new york a chance to diversify its economy. you did not like the tax rebate you could start

negotiating to change it. instead of saying, no, get out of the are. we would have had to modernize and upgrade our transit system. that could have been a benefit for the entire region. wouldne: amazon said it bring high-paying jobs to new york in exchange for a $3 billion break in taxes and subsidies. lender plans to return more than $2 billion to shareholders. they remain one of the strongest capitalized banks in europe. that's your bloomberg business flash update. let's get direct up of all the news in europe. in spain, a snap election will be in april. meanwhile on the brexit front, ireland tells germany it will not accept a hard border with the u.k., and car sales the

claim for the fifth straight month. let's start with where you are, spain -- elections. how critical is this in the wave of populist movements we have seen, and indeed right wing movement we have seen throughout europe in general? another election april 20 eight. this is the second prime minister in less than a year that has been kicked out and the third election in three years. it shows you the fragmentation we see in europe when it comes to politics. [indiscernible] caroline: we are losing you, maria. do you want to -- we will resettle and see if we can hear you a little bit better. we will take a quick break, see if we can get a more clear line with maria. >> thank you, carolyn. we will take a break here.

that's bloomberg's maria tadeo. and online retail expert joins us. this is bloomberg. ♪

>> in 2012, you received an offer and said thanks, but no thanks.

caroline: let's talk europe can go back to maria tadeo who joins us on the phone to discuss the snap election in spain. rhett, so we were talking about those. april 28. there was very little market reaction and this have to do with the fact that this is an election mostly about domestic issues. it's not really about the euro. it's not about the european union. is not an election that will play on the eurosceptic basis. it's interesting. we have at three elections in the space of four years, and it really does speak to the fragmentation we see in europe. this election, however, is about

domestic issues. which partyr, about will secure the national unity of the country. it's probably going to be another case of a big coalition, and we seem to be headed to another maybe two a, three-way coalition, which is, again, unprecedented, not just for spain, but most european governments. an interestingt time because theresa may is going into negotiations with the eu with regards to brexit and i guess the potential election in spain could factor into that? >> right. saying that the idea of the eu 27 unity has got to be toy strong and they need

hold in the final weeks of the negotiation and today, they had a story that made a lot of headlines, this idea the irish government has told the german chancellor, angela merkel, that in the event that the u.k. crashes out of the eu, they do not want to have a hard order and that is a sticking -- hard border and that is a sticking point. it's clear that 95% of the deal has been agreed if you get the border cleared. there will be a deal. if you don't, there's a very real possibility fall into no deal almost by accident. joe: maria, car sales tumbling. i mean, we talked about this earlier in the show. is there any good news out of the european economy? at this point, there isn't. the auto sector is really in focus. if you look at the european economy, it's really clear the slowdown has pretty much affected every country, but one isthe biggest drivers down

the fact that this is an expert economy, you make a lot of cars, you sell a lot of cars, and the ones feeling the heat are the ones with the tray tension between the u.s. and china and the tensions between the eu and trump. do not forget the u.s. president that the tariffs may have to be increased and the end of the week there will be a new report that may advise the president to take those tires -- tariffs higher. >> all right, maria. that's bloomberg's maria tadeo joining us by phone. now turning to the world of real estate, bringing digital disruption to connect homes, buyers, and sellers online, with full service for $3000 flat a.

the idea, cut down on costs by eliminating confession -- commission fees. chris joins us from denver. i of seen so many companies try to make a dense in the real estate market and eliminate the broker, a lemonade the real estate agent. >> we built software around our whole system. so, what that means is we do not have a real estate agent who is a jack of all trades. we have great process people that process. and the technology and the software we built takes the process and applies the specialists where they are needed. different?

i think there's a lot of companies doing the execs and thing and some offer even less of a fee to commercialize but we are different for that exact same reason. being able to have a specialized task for specialized people, it's really a differentiating factor for us. >> obviously the process of homebuying is an anxious one or home selling. people of all kinds of questions. talk to us about the comfort levels people have with the different models and the handholding that they get from the ai through the entire process. >> sure. when we started, people would say it's too good to be true, right? with time, people have become more and more comfortable with

choosing their own adventure, as i like to call it. you can list your home on your computer in the middle of the night or call up a real estate agent and request a consultation. we match to what the customer needs. >> are you seeing a breakdown or by therentiation generation? these kinds of services are targeted to millennials were the next generation down. using those consumers gravitate to the services versus someone of an older generation? >> sure. i'm a millennial. i thought most of our customers would be millennials and what we've realized is our customers are typically people who have sold a home more than once. they looked at how much money they had to pay the age and. they realize they gave up so much equity to the real estate itnt they don't want to do again. we have a great range of customers from all different sections and it's not what we thought we started with, but we

are very happy. caroline: thank you. y.e ceo of redef .hat is it >> bloomberg technology is up next. joe: have a great weekend. this is bloomberg. ♪

♪ emily: this is bloomberg technology. trade progress. president trump reiterates that he may extend the tariff truce with china and take steps to sell the deal to lawmakers. uber's losses continue through the fourth quarter of last year. sales are slowing. what does this mean? and bezos fails on new york.